How the cloud is opening strategic doors for more hospitals

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As hospitals continue their digital transformation, many are looking to the cloud to modernize their IT infrastructures, EHRs and data analytics capabilities to support value-based care.

Having a cloud-based EHR allows providers to rapidly provision and build out infrastructure without large capital expenditures, says Bob Krohn, partner and healthcare practice lead at ISG, a global research and advisory firm.

“Our clients prefer to view this as an operating expense rather than large capital purchases — more of a ‘pay as you drink’ type model,” he tells Healthcare Dive.

David Chou, chief information and digital officer at Children’s Mercy Hospital in Kansas City, Missouri, agrees — to a point. “It is cheaper for some, but you can get to scale points where it’s not cheaper,” Chou tells Healthcare Dive. “If you’re a really large organization, it may not be cheaper from a pricing perspective to have your infrastructure in a public cloud versus on premise.”

However, the cloud offers certain providers a host of options that could fit into their IT and patient data strategy.

What the cloud can do for you

Cloud platforms allow providers to leverage patient information gathered at multiple care points. Providers are already using them for telemedicine, patient engagement and population health purposes, and they’re increasingly seen as being just as if not more secure than traditional on-premise networks and data banks.

Organizations can get by with smaller IT and security staffs as well. For a smaller organization, “there is the ability to see data from different locations without having to set up extensive networks and network security protocols,” says Kathy Downing, vice president of information governance, informatics and standards at AHIMA.

Moreover, backup and redundancy are built into the cloud, making it easier to recover data in the event of a natural disaster or cyberattack. If a hospital experiences a ransomware attack, having the backup in the cloud under someone else’s security can allow them to bring their systems back faster because they’re backed up in an area the hacker can’t get to, she adds.

Scalability is another big factor driving cloud-based EHRs. “If you’ve got an application that’s growing exponentially like EHRs tend to do, if you want to increase the scale and increase your capacity … it’s a lot easier to do in a cloud-based environment” than it is in a traditional data setting, Krohn says.

The predominant trend in cloud computing is infrastructure as a service, where organizations purchase a vendor’s IT infrastructure as a service on a component basis, according to Krohn. Another option is software-as-a-service (SaaS), where organizations license EHR software and cloud platforms. A third option, platform-as-a-service, provides both software and business outcomes but has yet to gain traction in the hospital space, he adds.

Finding a host

When Tahoe Forest Health System wanted to upgrade its EHR, it turned to Mercy Technology Services (MTS), the IT arm of Mercy, one of the nation’s largest Catholic health systems. MTS offers Epic’s enterprise EHR to other hospitals in a SaaS model, and Tahoe, which serves two rural counties in California and Nevada, wanted to be able to share patient records with nearby hospitals in attractive vacation destinations.

The health system had been using a hosted version of Epic through another vendor for its ambulatory space, but that company did not host the acute care product. Being a critical access hospital, Tahoe couldn't afford a full-blown Epic install. With Mercy, Tahoe was able to go from six different health record systems to one EHR that covers all of its needs.

“We want to hit Meaningful Use, be able to get good reporting, get population health, all those tools that come with Epic,” says Jake Dorst, Tahoe’s chief information and innovation officer. “Those come with most EHRs now, but that was something we really wanted to leverage — using our data to help define our population a little better.”

Like other cloud-based EHRs, the model has built-in redundancy and disaster recovery. It also offers scalability, so if new products come along that require more hardware or horsepower, that’s handled by the host company.

The key, says Dorst, is finding a host company that offers strong support, not just during implementation but throughout the lifetime of the contract.

Hosting Mercy’s Epic will cost Tahoe about $1.2 million to $1.3 million a year, according to Dorst. When implementation is factored in, the cost is about $3 million a year over seven years, he adds.

The system went live in November, but Dorst already sees added value. “Hosting the product through and basically piggybacking on the license that is already owned by Mercy saves us a lot of money,” he says.

Krohn sees SaaS as an emerging trend with EHRs. “It hasn't penetrated the market to any depth as yet, but I feel bullish that it will."

Check out your vendors

Organizations planning a move to the cloud should conduct due diligence before choosing a vendor to ensure they have experience in the healthcare space.

The move to the cloud isn't without some growing pains, Chou says. IT staff who are used to building EHR infrastructure will be forced into more of a business-type role while the cloud handles configuration and technical functions. “It’s a big shift culturally from a department’s and an organization’s perspective,” he says.

“I would not want to be the first one to try and explain to them what HIPAA is, what our security assessment must provide and do related to access and things like that,” Downing says.

She recommends asking cloud providers for references from other healthcare organizations and getting a clear description of how the platform is set up and what it will interface with so that physicians aren't logging in and out of disparate systems. “Sometimes I’ll hear from organizations that it comes as a surprise to them that they’re using a cloud for the EHR and using a different cloud from something else, but they don’t come together in the middle,” she says.

From a contract standpoint, organizations should insist on pricing protection that locks in the price for a period of years as well as some sort of transition services. “In case that relationship goes sour, you want to have the ability to move your data out of the cloud for a specific provider,” Chou says. The contract should also include a good service agreement with acceptable rates, he adds.

With the right product, most organizations can expect to see a return-on-investment, according to Krohn. “If you look at infrastructure-as-a-service as a holistic solution for substantially all of your application base, we see ROI well above 40% depending on your scale, size and complexity."

“If you go small, it’s not going to be that much. It might not even be an ROI, it might be more of a strategic investment,” he adds. “But if you’re prepared to go big, then there can be substantial savings.”